FBR Forms a Committee to Resolve Tax Issues in the Capital Market - Android

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FBR Forms a Committee to Resolve Tax Issues in the Capital Market - Android

In a major development to attract investment in the stock market, the Federal Board of Revenue (FBR) has constituted a Read More

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In a major development to attract investment in the stock market, the Federal Board of Revenue (FBR) has constituted a committee to resolve taxation-related issues pertaining to the capital market including stock market, mutual funds, and real estate investment trust (REIT).

Senior FBR officials told Propakistani that the FBR has issued an office order for the constitution of the said committee. The committee has been constituted following a meeting between the tax authorities and Pakistan Stock Exchange Limited held at the FBR House on November 27, 2020.

The committee comprises members from the FBR, stock market and the Securities and Exchange Commission of Pakistan (SECP) for introducing capital market reforms and resolve tax related issues of the stock market, top FBR officials added.

The FBR Member Inland Revenue Policy would be the Chairperson of the committee. The members of the committee included Shauzab Ali Commissioner Securities Market Division Securities and Exchange Commission of Pakistan (SECP); Farrukh H Khan Chief Executive Officer Pakistan Stock Exchange (PSX); Ahmed Ali Mitha Chief Financial Officer PSX. The Chief Income Tax Policy would be the Secretary of the committee.

The Terms of References of the committee revealed that the committee shall act as a forum till budget making exercise for the year 2020-21 to review the tax policies and suggest specific short term and medium to long term measures for the development of the debt and equity market, commodity futures, mutual funds, REITs, corporate and insurance sector, amongst others. Broadly, it will review and implement all measures that impinge upon the capital markets and its stakeholders.

The committee may invite proposals from relevant stakeholders, deliberate and finalize tax reforms in the aforementioned areas.

The proposals shall be categorized into immediate, medium term and long term reforms and shall accordingly be prioritized.

First report of the committee shall be submitted to the FBR within 20 days of the constitution of the committee.

Necessary amendments in the tax laws shall be initiated in consultation with the committee for implementation of the agreed proposals.

In view of the experience gained, the TORs may be evolved and changed by the committee members as needed.

The recommendations of the committee are expected to be incorporated in the upcoming budget for 2020-21, FBR officials stated.

During the last meeting, FBR Chairman Javed Ghani chaired the meeting attended by a delegation of PSX headed by Farrukh H Khan, Chief Executive Officer/Managing Director. Ahmed Ali Mitha, Chief Financial Officer also attended the FBR meeting. The PSX delegation shared the issues pertaining to the capital market taxation and proposals to introduce reforms in the stock market.

Tax authorities had assured the PSX that the genuine issues of the capital market would be resolved on top-priority basis, the sources said.

According to sources, an official of the Securities and Exchange Commission of Pakistan (SECP) also attended the meeting at the FBR House.

Last year, the SECP had suggested the FBR for reducing Capital Gains Tax (CGT) rates for two years on disposal of listed securities in budget (2020-2021) to attract investment in stock market.

 

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08/01/2021 06:25 PM